May 2017

Illicit trade, an invisible enemy: MP S Dev

“Tax evasion needs to be seen as an anti-national act and illicit trade should be treated as a national threat,” stated Sushmita Dev, Member of Parliament, Lok Sabha.

She further emphasized on the need for a national agency to take over to stop the menace of illicit trade at the event that organized by FICCI CASCADE on the ‘Impact of Illicit Trade on Industry, Economy and Consumers’ on Wednesday.

While addressing the occasion, Arun Chawla stated that, “India today has the potential to become a global manufacturing hub. However, widespread smuggling and counterfeiting, in the absence of an adequate enforcement mechanism to stop it, can act as a dampener in achieving this goal.”

FICCI’s Committee Against Smuggling and Counterfeiting Activities Destroying the Economy (CASCADE), over the years, has been actively focusing on curbing the problem of growing illicit trade in smuggled, pass-offs and counterfeit goods. 

https://bureaucracytoday.com/latestnews.aspx?id=183145

Illinois Men Plead Guilty to Smuggling Untaxed Tobacco Products Into Minnesota

The Washington County Attorney’s Office has reached plea agreements with a pair of Illinois men accused of aiding and abetting the sale of untaxed tobacco, the Minnesota Department of Revenue announced in a release Wednesday.

Mohammad A.M. Abdul Majid of Bridgeview, Illinois, and Iman Gencehan Ugurlu of Oak Lawn, Illinois will each receive five years probation and have agreed to pay the state more than $74,000 in restitution.

The release states the charges stem from a traffic stop by the state patrol in which the men were reported to have been found in possession of more than $78,000 worth of untaxed tobacco products. According to the release, that was the largest known seizure of such products in state history.

http://kstp.com/news/illinois-men-plead-guilty-washington-county-court-smuggling-untaxed-tobacco-into-minnesota/4487347/

Interactive Session on Impact of Illicit Trade on Industry, Economy and Consumers, New Delhi

25/5/2017 | ITC Maurya, New Delhi

The existence and operation of illicit trade vis-à-vis counterfeiting and smuggling has been an enduring problem that has escalated in scope and magnitude, impacting industries, government, economies and, the health and safety of the consumers. Moreover, such operations have close links to terror organizations and criminal networks. In fact, it is today one of the biggest challenges faced by India and its industry, impacting the country’s image in the global arena.

FICCI’s Committee Against Smuggling and Counterfeiting Activities Destroying the Economy (CASCADE), over the years, has been actively focusing on curbing the problem of growing illicit trade in smuggled, pass-offs and counterfeit goods.

In pursuance of its agenda, FICCI CASCADE organized an interactive session on the ‘Impact of Illicit Trade on Industry, Economy and Consumers’ on 24th May 2017 at the ITC Maurya, New Delhi. The intent was to facilitate a wider exchange and ensure a multifaceted perspective to understand the gravity of the menace caused by illicit trade activities. The session focused on issues such as need for increased consumer awareness; strengthening of enforcement regime; impact of taxation policy; improvement in regulatory mechanism and enhanced stakeholder collaboration.

Ms. Sushmita Dev, Member of Parliament, Lok Sabha, was one of the key speakers at the event. She stated “Tax evasion needs to be seen as an anti-national act and illicit trade should be treated as a national threat,” She further emphasized on the need for a national agency to take over to stop the menace of illicit trade.

Mr. Arun Chawla, Deputy Secretary General, FICCI, in his welcome address, stated, “India today has the potential to become a global manufacturing hub. However, widespread smuggling and counterfeiting, in the absence of an adequate enforcement mechanism to stop it, can act as a dampener in achieving this goal. It is time that we, as a nation and as a part of the global economy, call for stern and resolute counterstrike force against such ill-intentioned activities.”
According to FICCI’s recent report, ‘Invisible Enemy: A Threat to Our National Interests’, the top five goods where the seizures by DRI has been the highest in the past few years have been – gold, cigarettes, machinery parts, fabric/silk yarn and electronic items.

The report also states that illicit trade operators are now switching over to cigarettes and fabric/silk yarn as they are low-risk, high-reward goods. As per the report, in the last one year, the DRI seizures of smuggled cigarettes has increased by 78% (from Rs. 90.75 crores in 2014-15 to Rs. 162 crore in 2015-16) followed by fabric/silk yarn, where the increase is by 73% (from Rs. 24.03 crores in 2014-15 to Rs. 41.78 crore in 2015-16). The seizures of gold have witnessed an increase of 61% (from Rs. 692.35 crore in 2014-15 to Rs. 1119.11 crore in 2015-16), while the DRI seizures of machinery parts and electronic items has seen a decline.

The interactive session was also addressed by eminent panelists including Mr. L. Mansingh, former Secretary, Department of Consumer Affairs, Government of India; Mr. Pankaj Kumar Singh, Additional Director, Directorate of Revenue Intelligence, Government of India; Mr. Pankaj Kalra,Country Manager, HPE India Pvt. Ltd and Ms. Deepika Raikwar, Regional Legal Manager, Hindustan Unilever Ltd.

Some of the key deliberation points that emerged from the panel discussion were as follows:

• 1. India is being used at a transit point for counterfeiting and smuggling. Stringent polices and strategic collaborations should be undertaken to counter this menace.
• 2. The responsibility also lies with consumers to counter counterfeits and smuggled products. Consumer need to be more aware and socially responsible to report fake and spurious goods.
• 3. Some consumers are unaware of counterfeit products, while some buy intentionally as they cannot afford branded products. There is a need of a transparent system and collaboration between stakeholders to manage this issue.
• 4. A single database for maintaining records of illicit trade should be maintained, which will make it easier for law enforcement agencies to act upon and control it.
• 5. Fast moving consumer goods, such as cosmetics, footwear, sunglasses, televisions, electronic products etc. are mostly counterfeited in the markets.
• 6. There is a need for increased information sharing between enforcement agencies and stakeholders for countering illicit trade.
• 7. Impetus on public policy is a must in countering this issue.

Mr. Anil Rajput, Chairman, FICCI CASCADE, in his closing remarks, emphasized, “Illicit trade is not just the enemy at the gates, but one that has broken through. All stakeholders must join hands to reign in this dangerous force.”
On the occasion, a film on FICCI CASCADE showcasing its achievements and activities since its establishment in 2011 was also released. Over 150 participants attended the interactive session and took part in the discussions.

Fake goods on the rise in India; illicit trade increases 44% in two years, new report shows

A study from the Federation of Indian Chambers of Commerce and Industry (FICCI) in India has revealed that the trade of fake goods in the country rocketed from 2011-2012 to 2013-2014. This confirmation that illicit goods are a pervasive part of the Indian economy – estimated to be between 8% and 15% of the country’s total gross domestic product (GDP) – serves as a stark reminder that the global trademark community urgently needs to focus awareness and enforcement efforts in the region.

The research was released by FICCI’s Committee Against Smuggling and Counterfeiting Activities Destroying Economy (CASCADE), which was set up in 2011 to explicitly address the growing illicit trade being witnessed in India. The primary aims of the committee are to generate awareness on the hazardous impact of counterfeit products in the country and to assist law enforcement agencies, including judges, the police and customs officials, in the fight against fakes. However, research evidencing the scale of the problem has also been a focus and its recent study, as well as a letter subsequently sent to the government, highlights a number of startling findings.

http://www.worldtrademarkreview.com/Blog/detail.aspx?g=5ac8d016-2fb8-4663-9319-b3142131a9f2

Combating Sale of Counterfeit and Falsified Medicines Online: A Losing Battle

The rapid growth of technology has transformed many brick-and-mortar businesses into online businesses, and medicines are now being sold over the internet. Influenced by the notions that online purchases are economical and do not require a prescription, the general public are keen to purchase medicine online through websites, social media and mobile apps. Online medicine purchase is presumed to be convenient and confidential, free from embarrassment of sharing personal and sensitive health information to a healthcare professional. Public in United States, Europe, Australia is generally aware that internet sales form part of the official medicines distribution channels, often a valid prescription is required for controlled medicine. However, unlicensed, substandard and falsified medicines with various dubious medical claims are advertised and sold illegally in many rogue online pharmacies (Jack, 2016). These include medications for weight loss, hair growth, and treatment of erectile dysfunction. Such medicines are termed as substandard, spurious, falsely labeled, falsified and counterfeit medical products by the World Health Organisation (WHO).

Similarly, the European Commission defines such products as falsified medicines or fake medicines that pass themselves off as real, authorized medicines (European Commission, 2016). These medicines may contain substandard active ingredients, which are low quality and/or an incorrect amount, either too high or too low, and have not been properly evaluated by authorities in terms of quality, safety, and efficacy. It must be noted that falsified medicines are often confused with counterfeit medicines. According to European Commission, counterfeit medicines refers to medicines that do not comply with European Union law on intellectual and industrial property rights, for example, unregistered medicines sourced from parallel import (European Medicines Agency¹). In this article, the illegal sales of both counterfeit and falsified medicines (CFMs) are discussed.

In 2012, the WHO estimated the CFMs industry to be worth USD 431 billion a year, but further estimates has not been reported in the recent years due to the fast growing, widespread practice of this industry, making it impractical to estimate on a global scale (Garrett, 

2012). Authorities are finding it difficult to curb CFMs due to the lack of governance over the internet. Furthermore, fragmented cybercrime legislation leads to large substantive and procedural lacunae in law, rendering law enforcement efforts useless.

https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5432535/

Record smuggling attempt thwarted in Poland

A record smuggling attempt of nine tonnes of tobacco was thwarted when Polish police found the contraband, worth PLN 5.5 million (EUR 1.2 million), in tins labelled as dog food.

The shipment was destined for Germany and was intercepted by police at the Polish-Slovak border crossing in Barwinek, southeastern Poland.

A Polish truck driver said he was transporting cans of dog food from Bulgaria to Germany, according to police.

But police found the cans were filled with tobacco from the UAE, intended for smoking in hookah water pipes. The driver has been detained. 

http://thenews.pl/1/9/Artykul/306219,Record-smuggling-attempt-thwarted-9-tonnes-of-tobacco-seized-in-Poland